How to protect your assets during a divorce
One of the most complex and important tasks during a divorce is the financial settlement. Therefore, it is important to contact a solicitor to provide you with comprehensive advice on all aspects of financial matters arising out of a divorce.
You may also wish to consider approaching a solicitor to discuss the possibility of reaching a collaborative prenuptial agreement with your partner prior to marriage/civil partnership in order to minimise litigation in the event of relationship breakdown.
Steps that can be taken before marriage/civil partnership
A prenuptial agreement is an option for both marrying couples and couples who are about to register their civil partnership to consider. It is a collaborative process of prenuptial negotiation in an attempt to promote an understanding of what both parties feel would be an agreeable settlement in the event of relationship breakdown.
A prenuptial agreement is a written contract, which sets out a scheme of financial settlement, division of assets and provision for any dependents. Both parties must enter the agreement having had independent legal advice and it must be signed at least 21 days prior to any wedding or civil partnership ceremony.
Whilst prenuptial agreements are not strictly enforceable in English law courts, the courts may take note and regard such agreements as very persuasive.
Steps that can be taken during a divorce
If you have decided to end a marriage or partnership, it is very important that you seek legal advice. Your solicitor will help you work towards an amicable settlement of financial matters out of court or, if this is not possible, guide you through the court process.
For most people, the family home will be their single most important asset. If you are registered as a joint owner of the property at the Land Registry you should be protected. Even if your spouse owns the family home in his/her sole name you may be entitled to a share in the equity.
At the very least, you will have ‘matrimonial home rights’ in the property, which will allow you to occupy the property without being disturbed. However, if your relationship is breaking down, you may need to register these rights at the Land Registry and should seek legal advice in doing so.
It is important to ensure that both parties provide full and frank disclosure of all assets and the other spouse does not dissipate assets. If you are concerned that your spouse or partner is disposing of marital assets that should be divided as part of the marital settlement, then you should consult a specialist family lawyer as a matter of urgency.
Your lawyer may need to make an application for a freezing injunction, which prohibits the other party from selling a particular asset or from transferring the asset to a friend or family member.
If you own a business with your spouse or partner, you need to carefully plan for each party’s involvement and assets of the business. Working practices need to be agreed on; for example, you may need to restructure the business or one partner may buy the other out. A final settlement involving a division or other dealing in respect of a pension will need to be confirmed by a court order.
If an agreement cannot be reached between parties, then an application can be made for the Family Law Court to deal with a financial settlement. It is important to reiterate that you should seek legal advice before agreeing anything (especially concerning mortgage or endowment policies) in order to protect your assets.
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